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Geneva Social Observatory |
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Geneva News |
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Sourcing From Women-Owned Enterprises: Ethics or Economics? 8
March 2010 |
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Maria
Korjenevitch, Intern -
In
honour of International Women’s Day, the International Trade Centre along
with Geneva Women in International Trade, held a panel discussion titled,
Sourcing from Women-Owned Enterprises: Ethics or Economics?
The discussion focused on the limitations for cross border trade by
small to medium sized women owned enterprises.
The possibilities and positive outcomes of such trade to local
communities were highlighted by a case study of The Africa Bag Project.
This project linked African women workers with an Italian company,
Unicoop, which purchased large shipments of their goods.
The effects of the project on the African communities were
tremendous. By allowing these
women to work, many were able to send their children to school and to
support their families economically. The
members of the panel were specifically asked to discuss women owned
enterprises in the context of ethics or economics. Ms. Francesca Gatteschi,
the head buyer for Unicoop, began by stating that both ethics and economics
were considered when beginning The Africa Bag Project, but that ultimately
Unicoop is a business organization and believes that the innovation and
quality of the bags produced will increase sales.
Ms. Jane Kabura, the CEO of Sanata Holding Limited and the founder of
The Africa Bag Project, also stated the important role of economics for the
African communities benefitting from this work.
The women are able to learn the importance of providing a quality
good to the customer, and are often able to transfer those skills to other
areas of work, such as the local markets.
Mr. Simone Cipriani, the Chief Technical Adviser on Ethical Fashion
of the ITC, stated that there is only a 1% error of quality in the bags,
thereby supporting the women’s attention to quality and detail. Overall,
the members of the panel agreed that the project may have begun as an
ethical initiative, but has proven to be an economic success.
Many
multinational corporations are trying to benefit from similar partnerships,
but there is often a lack of information between buyers and sellers.
Although 97% of multinational organizations have diversity
procurement programs, there still remains difficulty in matching
distributors with suppliers who produce a profitable market good.
Furthermore, although 23% of enterprises are women owned, only 1%
outsource to the international market. The
ITC works to match women owned enterprises with multinational organizations
in order to maximize opportunity. The
process for initiating these supply chains is often difficult and complex.
One problem faced by the African communities was financing the capital
needed for the resources to begin production.
Mr. Cipriani, discussed the problem of microlending.
He said that Unicoop finds solutions by giving down payments to the
villages and also by diversifying the supply chain, allowing each village to
produce one part of the finished good. Ms.
Elizabeth Vazquez, the CEO of WEConnect International (USA), stated that
many corporations have global supplier business chains and are interested in
purchasing from small women owned enterprises, mainly to have a global
footprint and become more competitive through the use of an innovative
product, but oftentimes lack of information makes this a daunting task. Projects
such as the Africa Bag Project have proven to be successful, mainly due to
an organized system of distribution of a product which fits the needs of the
market. Mr. Cipriani illustrated
the importance of a product to be connected to a distributor or a fashion
house in order to insure sales. He
provided an example of an African community producing woven baskets which
consequently were too large for tourists to purchase because they were
making what they knew how to do but did not appreciate the fact that
tourists have to fit their purchases into their luggage.
A distributor can help identify what kinds of products will sell and
can also connect the product to a larger market. According
to Mr. Cipriani, in order for a supply chain to begin, there must be an
organizational structure in which there is a system for controlling
production, planning, and quality. Also,
the participating communities must feel a sense of ownership in the
production process to have continued quality products.
Quality is necessarily the key feature against other competitor’s
goods, such as cheap low quality Chinese products.
Furthermore, government procurement policies and companies with
existing supplier diversity programs can help other small women owned
enterprises by both supplying the missing information on existing
enterprises to other purchases, and also by promoting sustainability.
Ms. Gatteschi emphasized the importance of sustainability for all of
the involved parties including the producers, the purchasers, and the
consumers of the product. Ms.
Vazquez highlighted that there is disconnect between those who purchase and
those who produce. She stated
that women make 70% of purchasing decisions, and therefore the venders
should be representative of consumer needs.
The consumer may view products produced by women owned enterprises as
more appealing, because as Mr. Cipriani described, there has been a change
in the world consumption habits, in which consumers are interested in the
stories behind the production of goods.
By integrating the innovative products of the small enterprise and
the emerging thoughtful consumer, sustainability may be achieved.
On the issue of transport and a business plan, Mr. Cipriani discussed Export Processing Zones and the possibility of negotiating a system of hubs for communities in order to ease the process of exportation of goods for small communities and businesses. Ms. Vazques discussed the role of Governments as buyers who hold a lot of purchasing power and therefore often introduce procurement policies. In conclusion, a comprehensive business case for change, incorporating principles of sustainability, diversification of supply chains, transparency, access to distributors, and ethical purchasing decisions, is a way to integrate more women owned small enterprises into the global market.
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